When I visited Domaining.com yesterday, I saw the headline announcing the launch of Valuate.com, a sister website of Domaining.com and a domain valuation tool that is run using Estibot 2.0. Users are allowed to look up 50 domain names if they aren’t registered users of Domaining.com and 200 if they are logged in to their Domaining.com account. This is the Beta version of the site, with the full launch expected to come in December.
One of the easiest ways to do a comparison of domain values is to compare recent domain sales from DN Journal with the results from Valuate.com. Since a domain name’s actual value is derived from what someone would pay for a domain name, one can infer that the recent sales price is close to its valuation. I wanted to take the new site for a test drive to see the results, and I figured using recent sales would be the most fair way to compare.
Below are some recent sales along with their prices and the Valuate.com valuation. I also added a few of my domain names to see how they are valued.
Domain Name | Sales Price | Valuate.com Valuation
Resumes.com | $400,000 | $910,000
Candy.com | $3,000,000 | $3,080,000
Bubbler.com | $10,000 | $10,000
Exterminator.com | $600,000 | $620,000
Ticket.com | $1,535,000 | $2,600,000
Luck.com | $675,000 | $690,000
Voodoo.com | $300,000 | $320,000
Jets.com | $375,000 | $620,000
Christian.com | $600,000 | $1,300,000
ChinaTours.com | $200,000 | $210,000
800.com | $250,000 | $260,000
Physicians.com | $250,000 | $700,000
DiamondRings.com | $228,420 | $1,970,000
Brazil.com | $500,000 | $630,000
FreeQuotes.com | $210,000 | $220,000
Snowboards.net | $30,000 | $31,000
Science.org | $20,000 | $29,000
LMK.com | $58,500 | $60,000
Some of my companies’ investments:
Torah.com | N/A | $110,000
Burbank.com | N/A | $160,000
Dreidel.com | N/A | $25,000
AthensVacations.com | N/A | $15,000
DubrovnikVacations.com | N/A | $1,000
CabCompanies.com | N/A | $2,200
CatOwner.com | N/A | $1,200
Oenophiles.com | N/A | $4,100
TropicalBirds.com | N/A | $2,800
Overall, some of the values seem to be fairly on point, although I wouldn’t sell a few of them at close to the valuation (TropicalBirds.com for example). My domain names were private acquisitions (except for Lowell.com), so there probably isn’t an element of human intervention with these values.
One thing I disagree with is the disclaimer, “We DON’T valuate businesses, we DON’T valuate sites.” Although it may not provide valuation on websites, the value takes traffic and incoming links into consideration. By default, developed sites have more of these valuable attributes, which could cause the value to increase. One could argue that the domain name ElliotsBlog.com is worth a few hundred dollars to someone else named Elliot who wants a blog. However, Valuate.com gives ElliotsBlog.com a valuation of $9,200, presumably because of the traffic and site ranking.
One way to really test its accuracy will be to rate the values of pending domain auction names before and after. This will let you see how accurate the system is – and it will also tell you if there are human filters correcting errors.
Here are some Valuate.com valuations of domain names that are up for auction this week during the Traffic show:
40.com – $62,000
900.com – $12,000
Arbitration.com – $250,000
Bands.com – $520,000
Boy.com – $620,000
CigarBars.com – $6,200
DataCenters.com – $27,000
EuropeanVacation.com – $35,000
GolfClubs.com – $410,000
Hookahs.com – $15,000
Marketers.com – $2,000
OfficeSupply.com – $110,000
Penpals.com – $22,000
QB.com – $15,000
ScubaDiver.com – $9,700
SecondMortgage.com – $140,000
SkyDiver.com – $4,100
TreasuryBonds.com – $40,000
WineCellar.com – $56,000
Zimbabwe.com – $410,000
Clearly, some of these valuations are way off. I’m no baller, but I would buy Hookahs.com, Marketers.com, QB.com, 900.com, ScubaDiver.com, SkyDiver.com, and WineCellar.com at those prices right now without even thinking about it twice.
A while back, I discussed Estibot and how I don’t think you can ever rely on the results of an automated website to get accurate domain valuations. I still agree with this, but I think Valuate.com can provide an additional sanity check when buying a domain name.
Francois recently put Domaining.com up for sale with an asking price of $3,000,000. Valuate.com only pegs the value at $110,000. As we all know, the only real way to value a domain name is by offering it for sale and seeing what someone will pay for it!
Great post Elliot. I must admit I’ve never been a fond believer in automated tools, I’ve always gone by the saying ” a domain is worth whatever the buyer is willing to pay for it” thats the saying I use on all my domain sales it allows me to get a lot of sales cause both I and the buyer are happy , im never disapointed that I don’t get the $4,000,000 that estibot promised me for a domain like weliketoselldomainsalldaylong.com or whatever.
with that said, I’ll go ahead and give you
$9200 for domaininvesting.com and we can call it a day 😉
Just kidding around.
Tools like this are useful as long as you
use it in conjunction with other tools when trying
to valuate a name or estimate traffic.
I hope Valuate.com is a success… it’s a great name
and it’s helpful to at least get an estimate or value.
That means either the buyers are really using this tool to make 6 fugure purchases OR this tool is using DNJ sales reports to ‘valuate’ the domains!
I’m 99% sure that valuate.com is just using Estibot’s beta API service to appraise these domains, perhaps with a small price adjustment automatically applied to some names. The majority of these names exactly match the new Estibot tool, and those that differ are typically off by less than 1 percent.
Having said that, I think the new Estibot tool is pretty decent for ballparking valuation. Like Elliot said, it’s a good sanity check and provides valuable insight when used in conjunction with other information.
I tested some domains whose prices were public and it’s using past sales records.
I tested privately sold domains and the values are out of synch by a 3x to 5x range.
I’ve yet to find any automated service that provides an accurate assessment. It can’t be done without the human mind.
As a broker it drives me bonkers when I start discussing pricing with a seller and I hear the words “Estibot says it’s worth $xxxxx”.
Cool then go sell it to estibot. LOL
I still prefer estibot.com because it shows how they came up with that figure, including looking at past sales.
Valuate would be better with more transparency.
A real test would be on upcoming auctions to see how it compares like previous tests of appraisal algorithms vs humans.
That bit about Domaining.com being only worth $110,000 was quite ironic.
Kevin above nailed it, perfect …
“I’ve yet to find any automated service that provides an accurate assessment. It can’t be done without the human mind.”
dcmike77: they are using estibot, lol.
Testing against published sales is not valid as the tool s/b using the same information. Better test would be comparing to domains at auction and their result, or against known but unpublished sales.
As ‘Domainer’ & ‘Kevin’ mentioned above, my guess is the reason the ‘(Estibot)/Valuate.com valuations’ map so closely to the recent ‘Sales Prices’ are that some may have been used as anchor points in the predictive modeling that Estibot is based on.
Especially as this is a beta version for the December release of Estibot 2.0, you would want to ensure a healthy sample/weighting of recent data points to help ‘teach’ the model about current day sales pricing.
In predictive research & models, it is generally true that more data points you have to represent a particular market/product segment, the better the model will be at prediction. And, usually, greater weight is applied to the more recently occurring data points. In the domain list above, all but four had a sales price > $100,000; and while I don’t know the actual # of occurrences, I would assume that the 14 listed resent a healthy proportion. With such a small population of > $100,000 ‘recent’ sales data to draw from, it would not surprise me if (unknowingly!) many from the selected list serve as anchor data points in the model itself.
Again, I offer this as a possibility as to why the ‘Valuation’ versus ‘Sales Prices’ are so close for the listed domains.
I want to tell you about 2 significant improvements:
a) Now when you compare domains you can sort them how you want: by value, traffic, search popularity, … simply click the top of the column you want the listing ordered.
b) Our prefilter script was “terrific” and we added a “pre-filter” button so you can use valuate just to pre-filter listed of names. In addition you can now select your filter preferences.